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HomeTop Business NewsNeil McDonnell Urges Financial Stress-Test for a Secure Future

Neil McDonnell Urges Financial Stress-Test for a Secure Future


The Irish attitude towards risk assessment has been described as unique. The Irish people are known for being optimistic and tend to believe that if something hasn’t happened to them before, it is unlikely to happen in the future. This perception has led to a lack of preparedness for potential risks, including cyberattacks. Until the recent ransomware attack on the IT systems of Ireland’s healthcare provider, the HSE, many Irish people considered cyberattacks to be something out of Hollywood blockbusters. The full financial and health costs of the HSE attack are yet to be accounted for.

In 2014, Ireland began carrying out the National Risk Assessment (NRA) process. The first NRA identified risks associated with cyberattacks, pandemics, and the potential impact of Brexit. It also identified a potential energy supply crisis, which was a result of the Russian annexation of Ukraine. However, with the exception of Brexit, which was an imminent political risk, Ireland did little to counter the other risks identified in the first NRA. It would be interesting to see how the Irish political system would respond if forced to apply the same test used by courts in personal injury cases – whether a risk was “reasonably foreseeable”.

ISME’s pre-budget submission will identify several longer-term risks that the Irish government must plan to address. The most significant risk is to the country’s national finances. With the recent revelation that Microsoft Ireland accounted for almost 4% of Ireland’s total tax revenue, the government must prepare for the possibility of large multinationals departing the country, taking their corporation tax with them. The government must also stress-test the exchequer finances in anticipation of a permanently elevated interest rate environment. Another risk that Ireland must prepare for is the possibility of artificial intelligence (AI) displacing or replacing high-technology jobs, particularly in the multinational sector. In the event that this does happen, the government must have a plan in place to retrain workers whose jobs have been altered or replaced by technology.

AI is not the only threat to Ireland’s multinational sector. The covid pandemic has increased political pressures in the US and the EU to “de-globalise” and “re-shore” essential products such as medicines, vaccines, and computer chips. All three are sectors with a deep multinational presence in Ireland. Additionally, the pandemic has had other scarring effects, including the inflation of asset prices, particularly housing costs, and food and commodity prices. Ireland must be prepared for the potential impacts of a conventional land or sea conflict in the eastern EU or the western Pacific on its economy and defensive stance. Irish reunification must also be planned for.

Climate change is already having an impact on Ireland. Munster and Leinster will suffer progressive coastal inundation, which will internally displace substantial numbers of people from Cork, Waterford, Wexford, and Dublin. Ireland must also plan for large inward migration from Africa as regions become uninhabitable. Planning for these risks now is a far better policy than hoping they don’t happen. Ireland must take a proactive approach to risk assessment and planning to ensure it is prepared for any potential threats to its economy, national security, and citizens’ well-being.

Thomas Lyons
Thomas Lyons
Thomas, the founder and chief editor at Top Rated, harbours a deep-seated passion for business, news, and product reviews. His thirst for knowledge and experience has led him on a journey across the length and breadth of the country, enabling him to garner a wealth of insight. At TopRated.ie, his sole aim is to deliver meticulously researched news and provide impartial reviews of fact checked Irish companies, thus helping readers make well-informed decisions.


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